Toronto to See Record Condo Deliveries in 2023

The Greater Toronto Area, known up north as the GTA, will see the delivery of a record number of new condo units in 2023, according to a new report from real estate data analysis firm Urbanation.

But the influx of new supply is not expected to impact on affordability as most of the new condos have been pre-sold to investors planning to rent out the units.

The report anticipates that 32,000 condo units will be completed this year, exceeding the previous record of 22,473 in 2020. It also projects the delivery of 7,740 purpose-built apartments, the highest total in more than 30 years.

Condo completion fell to 13,885 in 2021, due to pandemic-related supply chain disruptions and construction delays. The fresh supply is unlikely to have an impact on a drop in property listings and vacancies brought about by rising interest rates and inflation, Urbanation’s report said.

“We’re still making up for some lost ground that happened in 2021,” said Shaun Hildebrand, Urbanation president, in a statement.

Shortages in supply are expected to persist this year in the GTA as demand is driven by record immigration numbers and declining pre-preconstruction condo sales, which dropped 79% year-over-year in Q3 2022 as interest rates and construction costs soared.

“We’re seeing record-high immigration targets over the next few years, so population-driven housing demand is going to continue to rise and we’re going to need more housing,” Hildebrand said. “We’re also experiencing a substantial slowdown in new project launches, so in four or five years’ time we’re going to be dealing with substantially declining completions.”

Recent immigrants were exempted from a two-year ban on the purchase of residential property in Canada by non-Canadian individuals and corporations—passed by the Canadian government in June 2022, before a slowdown in homes sales deepened—went into effect Jan. 1.

The ban, put forward ostensibly to address housing affordability issues prices spiraled—and then narrowed by a series of exemptions the government has expanded in recent months—is not expected to have much impact on housing prices or sales in current market conditions after a series of rate hikes by the Canada’s central bank.

Regulations issued by the government have exempted from the ban buildings containing more than three dwelling units and recreational properties including cottages, cabins and other vacation homes. The ban also doesn’t cover properties worth less than $366K or those that located in areas that have a population of less than $10K.